Monday, January 11, 2010

A Lost Decade for U.S. Economy, Workers

Common Dreams.org posted an article by The Washington Post, written on Jan. 2 which is titled "Aughts Were a Lost Decade for U.S. Economy, Workers" | CommonDreams.org

Someone in the alleged "liberal media" finally reported on something that I've been pointing to, repeatedly, for years:
The economic expansion after Bush's tax cuts was the worst all around performance of all post WWII expansions.

How is it that conservatives are allowed to repeat things, over and over again, that are demonstrably false, without being challenged?
How many times have we heard conservatives present tax cuts as a magical cure for everything from cancer to hoarseness?

Here's the key point of the article:

"There has been zero net job creation since December 1999. No previous decade going back to the 1940s had job growth of less than 20 percent. Economic output rose at its slowest rate of any decade since the 1930s as well."

This article made some brief news the day it was published but I haven't heard any mention of it since. And even this article doesn't point out the connection between the massive Bush tax cuts and the failure to produce a robust economy. Not only did those tax cuts fail to produce the robust economy the supply-siders promised, but they also contributed to the huge deficits that we are facing. Don't you think that's important news, especially considering that the Republicans base their whole ideological belief system on the idea of the infallibility of tax cuts?

You would expect not to hear a peep about this from the right wing pontificators like Rush Limbag, but what about the rest of the media? What about the "Fair And Balanced" Network, Fox News?
Why haven't I heard Chris Wallace asking any loud mouthed Republican supply-sider to explain what happened?
Wait! I know the answer!
Because Chris Wallace is a very biased conservative who only reports the news that his audience wants to hear, in order to make it fit with what they have already decided the truth is.
And that truth is exactly what their right wing heroes (like Limbag, Hannity and Beck) and their emotional biases tell them it is.

By contrast, the tax rates under Clinton corresponded with the longest, most consistently high and sustained post WWII economic expansion, even though conservatives said his tax hike would cause a recession.
Am I saying that the Clinton and Bush tax rates caused their contemporaneous economic performances?
No. If I did that I would be committing the fallacy of correlation = causation. Notice that I used the word corresponded, not caused. I would have to present more evidence than a mere correlation in order to make that claim. However, right-wing tax-cut fanatics commit that fallacy every time they say things like

"tax cuts always make the economy grow!".

Well, you can only make the claim that, eventually, after a tax cut, the economy always grows, so far.
Because the economy, so far, after recessions, always grows, eventually, whether taxes are cut, raised or left alone. So you can say the same thing about tax hikes. Allow me:

"Tax hikes will always make the economy grow!"...eventually.

Just as tax cuts are always followed by recessions, eventually.
So why aren't they saying "Tax cuts always cause recessions"?

The truth is supply-siders are hard pressed to produce any evidence whatsoever that tax cuts produce extra economic growth.* I first heard this some years ago from an economist who was being interviewed on the radio. This economist had a lot of credibility with me because she supported some of the conservatives' claims and refuted some liberal claims.
But when asked if she agreed with Bush's claims that his tax cuts were responsible for a supposed great growth in the economy, she replied that she couldn't find any evidence for this and that the economy was actually performing below par in almost every area for that stage in the recovery.**
She went on to say that when she studied tax rates she didn't find any evidence of tax rates helping or hurting economic performance. (I have since found strong evidence that supports her findings.) The interviewer didn't ask her to explain why, like I would have, but I would say that it is because all the other economic factors far outweigh any effects that tax rates might have.

Let's not forget that we had economic booms in the 40's and 50's with a top marginal tax rate of 91%!
And you know how conservatives like to brag about the boom that followed Kennedy's tax cuts in the sixties? Yeah, he cut the top marginal rate from 91% to 70% during a recession, and the recession ended like it always does, and it was followed by a boom. That's right, we had a boom with a top marginal tax rate of 70%!

So while I wouldn't say that Clinton's tax rates caused the economic performance of the 90's, I would say that it didn't hurt it. Plus, it did produce a record surplus.

Another thing that the conservatives have loved to point to during the last several years is the lowered tax rate in Ireland and the subsequent "Irish economic miracle".
"They cut their tax rates and it caused the economic boom!" they would assert as a matter of fact while neglecting to control for all the other variables in the economy.

Well guess what? The Irish tax rates were almost identical to the Clinton era tax rates. Except that the top marginal rate was slightly higher and the bottom rate was lower.
So with evidence much less flimsy than what the Republicans offer for tax cuts, the Dems could claim that the Clinton era tax rates found the Laffer Curve.

*I'm talking about personal income taxes here.
** Including job growth, capital investment and GDP growth.

Sunday, January 3, 2010

Universal Healthcare

So, the other day I'm in a public library when I noticed a book on the New Arrivals bookshelf by Glenn Beck. It's titled "Arguing With Idiots", subtitled "How to Stop Small Minds And Big Government".
I was compelled to check this book out and take it home so I could absorb the brilliant wisdom of this tireless money-making machine.

"Irony" is a word that often comes to my mind when observing the world of right-wing social and political rhetoric.

From Wikipedia:

"Irony (from the Ancient Greek εἰρωνεία eirōneía, meaning hypocrisy, deception, or feigned ignorance) is a situation, literary technique or rhetorical device, in which there is an incongruity, discordance or unintended connection that goes beyond the most evident meaning. It is the expression of one's meaning by using language that normally signifies the opposite."

Stephen Colbert uses irony brilliantly to expose conservatives' hypocrisies, deceptions and illogic. I was using irony when I referred to Beck's "brilliant wisdom." However, the voluminous irony produced by Beck and those other right-wing blowhards is unintentional.

Take the title of Beck's book, for instance. It's obvious that he intends the word "Idiots" to refer to liberals. However, even a cursory reading of this (unintentionally) hysterical (in more ways than one) book will reveal who the true idiot is.

Beck expounds on everything from the Second Amendment to education to illegal immigration to the "nanny state."

I'd like to share my thoughts on his chapter on "universal healthcare."

In this chapter he attempts to knock down all the liberal arguments for "universal healthcare."
He first takes on the notion that as the richest country in the world, it is unacceptable that 46 million Americans are uninsured.

He points out that we are in deep debt and can't afford universal health care.
When conservatives make this argument they ignore the money that would be saved with a universal system. From Wikipedia:

"The UK government's National Audit Office in 2003 published an international comparison of ten different health care systems in ten developed countries, nine universal systems against one non-universal system (the U.S.), and their relative costs and key health outcomes.[3] "

This study shows that the nine country average health expenditure per head is slightly less than half of what the U.S. spends.

This is an astonishing figure. Let me repeat that. The other countries are spending HALF as much as the U.S., plus they cover everyone, regardless of pre-existing illness or whether they've lost their job. That is fucking HUGE! How can the Dems and libs be so casual about that fact?
Why in the world aren't the Dems and libs using this fact as a sledge hammer by constantly emphasizing and repeating it and forcing the conservatives to address it?

So we could SAVE money by switching. A lot of money. Think about it. We could budget a national health insurance system at 75% of what we are already spending, which would give us 50% more coverage than the other countries and STILL save 25%!

He then claims that the number "46 million" is over inflated, a distortion perpetrated by the left in order to misguide the citizenry.
Beck then proceeds to whittle this number down to "3% of the population."
This is how he does it:

10 million of the uninsured are non citizens. (Down to 36 million!)

18 million have annual household incomes over $50,000, with half of those over $75,000.
(Wow, already Beck has the number down to 18 million!)

Beck then engages in some interesting illogic.
He says that these people could afford health insurance if they wanted it and if "we" give "them" "free" health care "we" will be, in effect, paying for "their" cell phones, satellite t.v.'s and high-speed internet connections.

But, wait a second. If we had universal health care it would be paid for through taxes. So those people would be paying for our health care as much as we would be paying for theirs.
Did you ever think of that, Stephen Hawking?

If there is any freeloading going on it is happening now under the current system, the one Beck says works great and doesn't need to be changed.

Beck says that these people are choosing how to manage their own risk.
"Close to two-thirds of uninsured... are between... 18 and 34. They're overwhelmingly young, healthy people who have consciously decided that it's worth the relatively small risk that they get very sick."

Here's where the freeloading comes in:
One of the reasons they are able to take that risk is that the Republicans have not yet removed the safety net. We still live in a society that does not allow destitute people to die in the street.
So if that young uninsured person has a catastrophic illness or accident and cannot pay their medical bills, they file for bankruptcy and Medicaid. The creditors take a hit (which is bad for the economy) and the medical bills are paid by the tax payers (which raises the deficit. If these millions of young, healthy "high" income people paid into a universal healthcare system, it would CUT the deficit).

And bankruptcy would not be such a bad thing for these people because this demographic is the most debt-ridden in society.
So their debt is wiped out, their medical bills are paid and they're still young enough to start over, with a clean slate, courtesy of the taxpayers.

Beck gives another reason why we shouldn't care about these young uninsured:
"Many also figure... that they have their parents to back them up in case [of a] worse-case scenario..."

What Robert Oppenheimer doesn't explain is how shifting Jr.'s medical burdens onto his parents makes things any better. Someone still pays for lack of insurance.
Of course, not every uninsured person is young and healthy. Those who aren't can be forced to endure all kinds of hardships if they get sick. Unfortunately, Beck offers nothing to allay their grief and anxieties.

So next, Beck attempts to whittle the number down by another 14 million (which would bring the total down to 4 million).
He says that "14 million of America's 'uninsured' already qualify for government insurance; they just haven't applied for it yet."

Beck has citations listed in the back of his book and this one comes from Blue Cross/Blue Shield and Reuters, for what that's worth. That could be Reuters reporting on the study done by Blue Cross. And Blue Cross has an interest in keeping things the way they are. But let's assume it's accurate.
I've heard this argument used by everyone from Limbaugh to Hannity, "we don't need to change anything because all these people could be covered anyway."

Let me take this opportunity to say that, every single argument I've ever heard made by right wingers against "universal healthcare" is riddled with contradictions.
This one is a perfect example. There are contradictions on many levels with this one.

First of all, let me say that the Republicans/conservatives have been fighting tooth and nail to keep the status quo on healthcare ever since they lost the fight on Medicare. And they will continue to fight for the status quo until they have convinced enough fools that the U.S. Government (you know, the one of, by and for the people) is evil. Then they will abolish Medicare and Medicaid and turn healthcare completely over to the free market.
What about those who can't afford or get health insurance?
Just get your neighbors to help. That's what Republican Senators Grassley and Coburn suggested recently.
There's a foolproof plan if I've ever heard one.

Just check out the insidious irony here.
Do you think that the Republicans/conservatives want these eligible people to sign up? Would they be for the massive government sponsored drive it would take to do this?
Of course not. They want to keep the status quo.
They must love that 14 million Americans haven't applied for gov't insurance.
Because this means that we are not paying for their healthcare.
Plus, they can continue to use the fact that these people "already qualify for government insurance" as an argument to keep the status quo, thus keeping those 14 million uninsured, uninsured.


The Republicans/conservatives would hate it if these 14 million Americans applied for gov't insurance. They would be totally against it. Because it would require more tax money.

Beck next works on the remaining 4 million.
"More than half of those who are considered to be "uninsured" are in that state for less than a year as they move between jobs or deal with temporary changes in their lives."

What Enrico Fermi here didn't ever think of is that for every person who gets off the uninsured list, there is another person who comes on. That is why the number remains constant. And the net result is the same.

Also, think of this scenario:
Someone gets sick with a cronic disease like hepatitis, misses days at work, loses his job as a result, loses his insurance, loses his house.
Eventually he gets a new job and if he's lucky enough that that job offers health insurance, he is now in the "pre-existing illness" category with no coverage for his hepatitis. Nice, huh?

Next he takes on the liberal lie that insurance is too expensive to buy on your own.
He talks about insurers who offer basic youth-oriented health-insurance for a mere $50 a month.
I've heard other right wingers like Mark Levin talk about plans that are only $1,200 a year.

Now can you imagine what kind of coverage you'll get for that amount of money? Let's not forget, this is capitalism we're talking about. You only get what you pay for... minus profits for the company, plus advertising, administrative and lobbying costs.

He then presents the Republican/conservative panacea for reducing the cost of insurance.
Untie the hands of the free market and remove the restrictions on buying across state lines!

What these scientists working on the Manhattan Project didn't ever think of is what I heard an economist say about this. If you allowed buying across state lines it would raise the price of the lower plans.
Why? Because, for example, if millions of New Yorkers would buy into a cheap plan in, say, Utah, it would drastically change the demographics, in other words, everything insurance companies use to estimate costs, thus raising the price of the plan.

The current problem isn't lack of competition.
There is plenty of that, even within states. Every Nov. my job would have an "open season", when you are allowed to change your insurance company if you want. There would be about a half dozen or more companies in the cafeteria offering their services. The differences among the companies was like six of one, half a dozen of another. Do I pay a higher deductable for lower premiums, or higher premiums for a lower deductable? No matter which one I choose, I'm still out of luck if I lose my job and can't make my payments, which is exactly the situation I found myself in a few years ago.

The current problem is the inherent flaws of the free market system.

Right wingers have been demonizing the government for decades. At just about every opportunity they will tell us how bad the government is, how the government can't do anything right. The government isn't just inept and incompetent but downright evil. (At a later time I will present a defense of "the government.")

Beck takes a swipe at government in an attempt to discredit the idea of universal healthcare.
"You don't want the same people who run the post office cutting your chest open for an angioplasty" (page 237).
Wow. Beck has a powerful argument here. I sure as hell wouldn't want a Post Master cutting my chest open for an angioplasty, not least of all being that angioplasties do not require cutting someone's chest open.
Taking this into consideration, I would have to say that anyone who would present this idea as the way to run a universal healthcare program would have to be an idiot of the first order.
And the only person I know of to have done that is... Glenn Beck.

I was listening to Mark Levin railing against universal healthcare.
(For those of you not familiar with this radio host, he is a vile right wing hatemonger who, when he isn't plugging his own books and products, spends what remains of his daily three hour radio show spewing vituperative insults at Democrats and liberals in an angry, snarling tone of voice, which he obviously ripped off from Bob Grant).
"This idea of taking money from some people and giving it to others has got to go!", he yelled at his audience as he defended the free market system of private insurance against the tyranny of "socialized " medicine.
Taking money from some people and giving it to others? That's exactly what private health insurance does. It takes money from people who don't get sick and gives it to people who do.
Did you ever think of that, Sir Isaac Newton?

For some reason creeps like Beck and Levin have managed to convince a lot of people that they make sense.
But I have to admit that on page 243 of his book Beck finally does make some sense:

"We all know by now that just one person who can't get access to health care is too many, but, outside of a complete government takeover, there is no way to get everyone covered---"

But just when you think Beck might have cleared his mind from his right-wing ideological stupor he adds:

"---it's just not practical."


In my next post I will explain the inherent flaws of the free market system and how they contribute to "a market failure" with regard to health insurance.
Then I will demonstrate how government is the MOST practical way to administer health insurance.

I will also take on the second half of Beck's chapter where he reports on the "nightmare of socialized medicine" abroad. You know, waiting lists, government rationing, death panels!

In the meantime, while you're "arguing with idiots", tell them about this blog. I really want to give conservatives something to think about.